Based on an independent audit of Aqua Indiana, the Indiana Utility Regulatory Commission has ordered the utility that serves much of Aboite Township to:

*Update its master plan to reflect deficiencies identified in the audit. Aqua Indiana has until October 1, 2013 to complete and submit a new master plan to the IURC.

*The utility must also identify and implement a solution by May 1 to address fire protection risks related to its interconnection with Fort Wayne City Utilities when its water supply falls short of demand. The IURC did say that another well Aqua Indiana sank this year provided adequate capacity for Aqua to end its connection with Fort Wayne City Utilities.

The private utility is already well on its way to complying with the orders, Aqua Indiana President Tom Bruns said Friday afternoon.

“Overall, I think the consultants did a very good job for the IURC,” Bruns said. He said that a South Bend consultant already is examining the utility’s well fields and working on ways to increase capacity and improve delivery.

Bruns’ only significant contention with the report, he said, is the way auditors calculated the utility’s capacity. The consultants calculated capacity without including one of the system’s wells, he said, describing it as an issue of “regulatory capacity versus real capacity.”

Ted Nitza, program manager with City Utilities, said the report supports the city’s rationale for trying to acquire Aqua Indiana through condemnation.

“All of the items pointed out could be addressed much more cheaply, more quickly and more permanently” by the city taking over the private utility, Nitza said.

Fort Wayne City Councilman Mitch Harper, R-4th, praised the report and recommendations. Harper emphasized the auditors’ finding that the connection between Aqua and City Utilities fell short in providing necessary fire protection.

“The Commission has set out a timetable for compliance by Aqua Indiana. The steps that the IURC has recommended are a welcome and needed sign for the thousands of citizens in southwest Fort Wayne," Harper said in a statement he released after the report.

Despite the contention over Fort Wayne’s drive to take over the private utility, Bruns and Nitza agreed that both entities would be able to cooperate if Aqua Indiana needs help serving customers, as it did last summer.

The audit was done in two phases. The first, completed earlier this year, looked at the way Aqua Indiana responded to the drought this summer and the insufficiency of its water supply. The second part, delivered Friday, addressed broader issues facing the utility.

The major findings of the second part of the audit include:

*This summer's water-supply crunch was based on several problems. “High temperatures and dry conditions increased customer usage and water loss due to water main breaks. Wells were out of service for repairs and replaced with lower-capacity back-up wells. Prolonged pumping at higher rates may have led to a decrease in water production from the aquifer,” the report said. As the auditors noted, “None of these factors were unprecedented but their combined effect pushed the (Aqua Indiana) system beyond its water production capacity.”

*“Aqua's procedures during the recent water-pressure and service issues followed industry practices but their planning prior to those events did not. (Aqua Indiana) relies on the combined capacity of all wells to meet peak customer demand. Water industry standards highlight the need for reserve capacity,” the report said. Aqua Indiana didn't have adequate reserve capacity to weather the demands of the 2012 drought, according to the report.

*“Until adequate reserve capacity is added from additional wells or other source, connection to the Fort Wayne water system should be included in the Utility Center water master plan. … Connection to the Fort Wayne water system is necessary to supplement the inadequate reserve pumping capacity in the Utility Center water system,” the report said.

*“Planning is needed for the next period of high customer demand when the purchase of water from Fort Wayne resumes,” the report said. Auditors said that the planning is needed so that there are no longer pockets of Aqua Indiana customers with insufficient water flow to provide good fire protection.

*Fort Wayne and Allen County ought to pursue water-conservation ordinances to support water-supply planning and avoid the rate increases that would be needed to pay for greater peak capacity, the report recommended.

*Although Aqua Indiana's master plan adequately addressed the growth in customer base, water production and water storage needs when it was developed, it didn't provide for reserve capacity that met industry standards, the report said. “The current master plan should be revised to include growth in customers and water production that reflect current growth rates and needs for reserve water supply capacity from additional wells and the connection to the Fort Wayne water system,” the report said.

For more on this story, check back later or see the print edition of The News-Sentinel Saturday.